The mechanics of the stealth layoff: negotiating for voluntary leave (Part 3)

Today, we conclude our three-part mini-series on the mechanics of the stealth layoff. We have now discussed the first two parts of the stealth layoff: establishing the record and informing the associate. The final piece is negotiating for voluntary leave and is, in many ways, the most interesting aspect to the stealth layoff: it explains why stealth layoffs are “stealthy.”

So how does it work?

Often, but not always, the firm will offer the possibility for the associate to quit voluntarily. If the firm doesn’t offer, you can always suggest it as well. The exact terms of the departure can be negotiated, and depends on specific circumstances. All of the following are possibilities:

1) Departure within a normal, two-week notice so there’s no suspicion of a layoff.

2) Removal from payroll immediately but opportunity to continue to come into the office in order to find a new job.

3) No access to a physical office, but firm provides continued access to e-mail, office phone (through forwarding system) and keeps attorney bio on firm website until a new job can be found

The weirdest story is that of an associate who was laid off but kept coming into the office to work and eventually made partner. Go figure.

Why would a firm offer these incentives?

As much as Biglaw firms appear to fire or conduct layoffs of associates and staff with complete coolness and detachment, it’s never an easy task. The vast majority of partners would likely rather be playing golf than sitting in their offices firing associates. No one wants to be the bearer of bad news, justified or not.

Firms also feel like their reputations take a hit when a layoff occurs. Especially during tough economic times, a layoff signals to the entire legal community that the firm is economically weak and potentially unstable. In a world where Biglaw firms compete against each other for vital business, any indication of weakness is, at best, damaging, and at worst, fatal, to a firm’s reputation.

If an associate agrees to this arrangement, it’s considered a voluntary leave. This makes it much more difficult for the associate to sue the firm later for wrongful termination. For the firm, it’s another way to “litigation-proof” the layoff. The downside for the associate is that, unlike a layoff which allows you to collect unemployment checks, a voluntary leave precludes the associate from taking advantage of such benefits.

Finally, when associates are publicly fired or laid off, that action sends shock waves through the firm and depresses associate morale. Fear spreads through the firm like an out-of-control wildfire. Am I next? When is the next layoff happening? When does the bloodletting stop? Try working under those conditions when you find yourself surrounded by empty offices and a mortgage to pay.

For all the above reasons, firms would rather have the associate leave “voluntarily.” It’s far more pleasant for the firm to maintain its pristine track record of never having fired or laid off anyone.

Why would an associate agree to this stealth arrangement?

First, it prevents a certain amount of embarrassment or humiliation from the layoff. Second, it is much easier to land a new job if you can represent to your prospective new employer that you are gainfully employed and want to leave for reasons other than a forced termination. Third, it provides a boost to your confidence. If the pretense is kept up by both sides and no one else is wiser for it, you can start to believe that, in fact, you did want to leave voluntarily.

Sometimes, self-justification is the most important thing.

Next week: tactics for searching for and landing a new job while being gainfully employed at your current firm.